With many people working from home or having been laid off due to the coronavirus pandemic, many Americans now have or are planning to start a home-based business. But will your homeowner’s policy cover the risks of a home-based business? In nearly every case, the answer is no. While some insurers will offer special endorsements, such as one to run a child-care operation from home, fewer and fewer companies have been offering them. Even with a special endorsement, policies may provide limited coverage for business
property. The bottom line is, nearly all homeowner’s policies exclude business operations and not having proper coverage in place can leave you with uninsured exposure.
This is why you need separate commercial insurance to cover your business risks.
A business owner’s policy protects the unique interests and property of a business owner. This package policy includes nearly all of the coverage you need. Business insurance covers you in situations where someone takes action for information on your website, or if someone is injured by the product, or service, you provide. Off-premises injury can occur when someone trips on or is injured by property you have taken into the field, such as to a trade show or if you are working at a customer’s location. Additionally, business policies include coverage for personal injury lawsuits, should someone take legal action against you for things like libel or slander. Business insurance will also cover theft of or damage to equipment, furniture, inventory and any other physical assets. A business policy usually covers loss of income as a result of a covered loss. Policies may also cover valuable papers, damage to property of others, property coverage off-premises and more.If you are providing consulting or other non-tangible professional services, you may also need a professional liability
policy. In addition, if you have any employees, you are usually required by law to get worker’s compensation insurance. You’ll also need a commercial auto policy if you have a business vehicle.
Hoping that your homeowner’s policy is going to cover you in the event of a claim will leave you frustrated if your business experiences a loss. Businesses have a higher risk than a homeowner’s policy allows for, and homeowner’s claims adjusters will deny coverage for business-related claims.